The FCC’s 600 MHz incentive auction drew high bids from T-Mobile US, Dish and Comcast, with Verizon failing to garner a single winning bid.
T-Mobile US, Dish Network and Comcast walked away as the highest bidders in the Federal Communications Commission’s 600 MHz incentive auction process, with the three accounting for $15.9 billion of the auction’s $19.8 billion in net proceeds.
T-Mobile US led the charge, with the nationwide operator posting nearly $8 billion in winning bids. The carrier, which said it would be aggressive in the low-band spectrum auction, picked up 1,525 total 10-megahertz licenses covering 414 of the auction’s 428 partial economic areas.
While auction leading, some had predicted the carrier would spend up to $10 billion, as it had been active in stocking its coffers ahead of the process.
Dish Network continued to bolster its spectrum holdings, with the satellite-television company picking up 486 licenses covering 416 PEAs for $6.2 billion. The company participated in the auction under the ParkerB.com Wireless name.
Dish – and its bidding partners – bid nearly $14.5 billion during the FCC’s previous two spectrum auctions in a move to bolster its already bulging spectrum portfolio. However, the company, which has yet to launch a commercial service taking advantage of its spectrum holdings, was forced to return $3 billion of the licenses from the AWS-3 auction due to irregularities in handling the designated entity status.
Comcast was the auction’s third-largest bidder, picking up 73 licenses covering 72 PEAs for $1.7 billion. The cable television giant has been a frequent participant and winner in past FCC spectrum auctions, though has sold off most of its winnings in the secondary market. The company did recently move on long-simmering plans to launch a mobile service using a mobile virtual network operator agreement with Verizon Wireless gleaned from one of those license deals.
The only other bidder to top $1 billion in total gross winning bids was Columbia Capital-backed Channel 51, which acquired eight licenses covering five PEAs. However, the company participated in the auction as a “small” bidder and thus was granted bidding credits that took its net total down to $859 million.
Other notable telecommunication operators winning a significant number of licenses in the auction included AT&T, which picked up 23 licenses covering 18 PEAs for $910 million; and U.S. Cellular, which acquired 188 licenses covering 92 PEAs for $329 million.
A notable absentee from the winner list was Verizon Communications, which while registered to participate, ended up not winning a single license. Some had expected the carrier to bid up to $10 billion in the auction, though the carrier was the highest bidder in the FCC’s 700 MHz auction held in 2008.
The forward auction process ended last month, with the FCC concluding the assignment phase of the proceedings. The assignment phase, which began on March 6, had companies that won licenses in the forward auction covering the 428 partial economic areas bid again for where those 10-megahertz license blocks would fall within the up to 70 megahertz of spectrum in each PEA.
The assignment phase added approximately $200 million in auction proceeds, pushing the auction’s total haul further past the $19.4 billion generated in the 700 MHz auction held in 2008, but well short of the more than $44 billion in gross proceeds from the AWS-3 auction that ended in early 2015.
The FCC noted the 600 MHz incentive auction generated nearly $7 billion for the U.S. Treasury for deficit reduction; more than $10 billion of the proceeds will go to broadcasters that chose to relinquish spectrum usage rights; and up to $1.75 billion for other broadcasters that incur costs in changing channels.
Television broadcasters that gave up their spectrum holdings as part of the auction’s reverse bidding process are now on the clock to give up those licenses over the next 39 months. That timing would put full spectrum availability into early 2020, or about the time most expect commercial “5G” services to be coming on air.
Initial 5G deployments are expected to focus on higher band spectrum licenses in the 3.5 GHz band as well as millimeter wave bands higher than the 15 GHz band. These bands are set to include broad swaths of spectrum support in order to meet the expected capacity needs of 5G services.
However, broader coverage will require lower spectrum bands. Many see 5G deployments relying heavily on current LTE deployments using low-band spectrum in order to meet coverage demands, with the 600 MHz spectrum able to bolster the supply.
FCC Chairman Ajit Pai applauded the proceedings, which began under his predecessor Tom Wheeler, but noted hard work remained.
“Today marks a major accomplishment for the commission: the ‘auction’ portion of the world’s first incentive auction is officially over,” Pai said in a statement. “The reverse and forward auctions have concluded and the results have been announced. But this process is far from over. Now, we begin the post-auction transition period. This day has been a long time coming. We congratulate all bidders who were successful in the incentive auction, and we applaud all of those past and present commission staffers who worked so diligently on every aspect of this complex undertaking. We have only reached this point because of their tremendous skill and dedication to this groundbreaking endeavor. Again: While we celebrate reaching the official close of the auction, there is still much work ahead of us. It’s now imperative that we move forward with equal zeal to ensure a successful post-auction transition, including a smooth and efficient repacking process.”
Bored? Why not follow me on Twitter.
